Autos and Online: Not Dead Yet

by admin on January 30, 2011

October 16, 2006 – By Mitch Lowe
iMedia Connection

Forget Yahoo!’s predictions of doom and gloom. Jumpstart Automotive’s CEO explains why the present — and the future — of online automotive looks brighter than ever.

These days, the online community is getting some mixed signals about internet advertising spending in general, and the automotive industry in particular. For example, on the one hand, research firm eMarketer says internet ad-spending will grow to a record $15.9 billion in 2006. On the other hand, the researcher also says growth will decline to +26.8 percent (vs. the 30 percent increases experienced in each of the last two years).

Is the falloff at Yahoo an indicator of a broader slowdown of web spending, especially from the auto makers? Not from where I sit. The market for auto ad inventory is robust, with some seasonality. Auto ad spending is always lumpy, as it heavies up during new model launch periods. The first two months of Q3 were lighter on launches, but Q4 and 2007 are heavy for launches. In 2007 there will be 50 percent more launches than 2006. Online 2007 ad inventory is already being committed to (at least to the Jumpstart Network) at both volume and rates that are higher than anticipated. More good news: Chrysler says it will more than double what it spent on (all) advertising in the first half for the remainder of 2006. As AdAge reported, Chrysler spent $527 million in U.S. measured media in the first half of this year, which would place its second-half budget well over $1 billion.

I frequently speak with the heads of agencies for the carmakers, as well as senior marketing execs at the carmakers. Now more than ever, they need the precision targeting, accountability and interactivity of digital media. While digital media is still coming to grips with its impending maturity, and is sure to face its own short-term challenges, it is tailor-made to what today’s auto industry requires, and we expect to see more than 30 percent growth in 2007. Read More

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